Jim SinclairGold, the US Dollar and Crude
There can be no conclusion other than the obvious fact that .8500 is a crucial level for the USDX.
Crude is proving that any active market that cannot be driven lower by an army of short sellers is clearly headed higher.
Gold is acting better than even the rational bullish market participants expected. Gold is showing that it wants the upside, not the downside and it wants it in a BIG way.
Gold is reflecting the fact that "Like Father - Like Son" the Democratic sweep of the mid term election has caused shock and surprise in the White House. It will turn to anger quite soon.
Anger clouds judgment. Clouded judgment spawns serious mistakes. Serious mistakes create gridlock in politics. Gridlock leads to items spinning out of control.
Of course the Chinese as well as all fiscal surplus Asian countries will purchase gold as they are gold poor in their reserve position.
There is no question at all about that and there never has been. Asian diversification of their reserve dollar position into gold and the Euro (non-dollar) has always been the thesis of Chung Phat.
This is NOT new news nor is it the lone reason for gold's move today.
Gold’s target now is $650 and then on to $682.
Gold rules 2007 and 2008 in a major way.
The metals shares that have outperformed under bear pressure will continue to outperform in a bull phase. Laggards will lag. That is a simple rule of this business.
Buy weakness and sell 1/3 on strength. If you have bought strength and sold weakness there is still time to stop losing your shirt. Bite the bullet and stand aside. Buy the next reaction.